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Editorial: PM's cutback has own logic

Published on February 11, 2002.

In the strange world of tobacco products marketing, Philip Morris USA's decision to retreat further from mass media advertising has its own, unproven logic to it. The Philip Morris Cos. unit is betting it can slash magazine ad spending, concentrate on other marketing battlefields (such as in-store and direct-database marketing) and still maintain its momentum.

It could work. PM USA is one of the few marketers in the U.S. that could sharply lower its mass media presence and, maybe, get away with it. It held a 51.5% share of the U.S. cigarette market last year, and no rival brands pose much of a present threat to its incredible Marlboro franchise. And, of course, PM USA will remain a major marketing spender outside the orbit of traditional measured media.

Tobacco marketing is different than any other category because growing the market-what mass-media advertising is often called on to do-is no longer an acceptable objective for this industry, at least in the U.S. Holding share and earning hefty profits in a declining market is the strategy.

Beleaguered magazine publishers, hammered by the ad recession and already fearful that liquor advertisers will shift dollars to TV, are reading the worst into PM USA's plans for their medium. PM USA has not said how deep and how permanent its magazine ad cuts will be. With PM absent, however, publishers have a strong case they can make that magazines now offer a rare marketing platform where PM will not overshadow its competition.

Magazines and other mass media remain potent brand builders. If PM USA thinks it can do with less of what they offer, it's because Marlboro is living off the strength that PM built using those media. Other tobacco marketers should have a different perspective. If a rival is to make gains at Marlboro's expense, it's hard to see how that will happen without at least some significant support from magazine ads.